The Gresham Hotel Group, currently the subject of takeover speculation involving Israeli group Red Sea Hotels, has reported sharply lower profits for last year, which it described as one of the most difficult in living memory for Irish tourism.
Turnover was marginally lower at €55m while operating profits fell from €13.5m to €7.7m. At the pre-tax level there was a loss of €4.8m, compared with a profit of €9.3m the year before. This was mainly because of a write-down in the value of its Carat Hotel in Hamburg.
Total gearing fell from 70% to 53% after a cash injection following the sale and lease back deal involving the Royal Marine Hotel in Dun Laoghaire.
On the outlook for this year, Gresham said conditions would continue to be challenging, but there were encouraging signs emerging from the domestic market.
In the results statement, chairman Sean Henneberry referred to the recent war of words with Red Sea. He said Gresham welcomed the co-operation of any shareholder group but would not allow control to be acquired by stealth, or have the group acquired effectively at a discount.
* The Red Sea Hotel Group has responded to today's results from the Gresham Group and said the group was concerned at 'the appalling financial performance of Gresham under the stewardship of the current board of directors'.
Amos Pickel, Director of the Israeli group, said the results are 'shocking'. He said the Gresham board now has a fiduciary duty to explain to all shareholders why costs have rocketed and profits have been eroded.
